Weekly Review August 22-26

Developing countries tend to have high export rates of their most valuable resource: people. However, many changes on the ground in Africa are encouraging entrepreneurs to stay and create businesses and better lives for themselves at home. A successful entrepreneur in the developing world is no longer a rarity. In fact, entrepreneurs are finding great success in Africa in ways that also have the potential to have a significant impact.

Historically, entrepreneurs are more likely to be men, but women are certainly making a splash in the entrepreneurship marketplace .The latest post from Afrographique highlights data on female entrepreneurship in Africa. The chart shows that in Ghana, Botswana, and Zambia, almost half of enterprises are owned by women. This entrepreneurship climate shows a progressive attitude that will have social and economic benefits.

A few weeks ago, Jeremy Fryer-Biggs introduced the Invested Development team to the Strivers Foundation, an organization that works with bright men and women in Uganda to help them achieve their entrepreneurial goals. The program benefits the individual as well as the economy by creating local businesses, jobs, products and services. One Strivers student, Nasur Mugega, shows real entrepreneurial drive and technological savvy. He developed a mobile phone charging platform powered by a bicycle and entered it in the Business Plan Competition to receive Strivers Foundation Funding. Nasur is an example of a bright student tapping into his entrepreneurial spirit to better his life and the lives of those around him. Many thanks to Jeremy for introducing us to him and the Strivers Foundation. Visit the site to read Nasur’s biography and those of other Strivers students who are studying and working to become entrepreneurs in Uganda.

After decades of skepticism from investors, entrepreneurs are frequently finding success in Africa. Many factors are contributing to the increase in entrepreneurship, including an explosive growth in mobile phone penetration (currently at 50% in the continent). The IFC and World Bank’s Doing Business 2011 report indicated that the ease-of-doing-business indicator has increased in many African countries and investment climates are improving. More efficient and less expensive business registration processes also allow Africans to tap into their entrepreneurial spirit.

As entrepreneurship becomes increasingly common in Africa, so does the need for investment and lending. It is especially difficult for micro-entrepreneurs to borrow money, since most do not have bank accounts or access to financial services. Microfinance institutions have worked to change that, but we came across another solution leveraging technology. Zidisha is a peer-to-peer microfinance organization operating on an Internet-based platform. Entrepreneurs can create a profile to reach out to potential lenders. Lenders can read reviews on the borrower’s credibility and past repayment scenarios. The borrower and the lender can communicate directly through the platform. In Kenya, the funds are usually delivered via M-Pesa. To date, 130 businesses have been financed with a 100% repayment rate. This is a creative platform leveraging technology to empower the world’s poorest citizens.

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